Don't build a product unless you can validate it

I've seen it happen repeatedly: a smart, young founder brings his favorite idea to Lean Startup Machine or LSM (a startup workshop), builds a team around it, plans his first experiment and gets out of the building. He talks to his target customers but they don't get it and he gets confused. "Am I doing this right?" he asks.

Then he gets beaten up by the mentors, who inevitably ask, "What problem are you solving?" and the founder doesn't have a good answer.

He gains courage to interview more potential customers and users, but doesn't change much and ends up with the same result. At the end of the workshop, the founder may still give a convincing presentation, mostly because he's charismatic and smart. But the judges aren't impressed. They notice he doesn't have traction and hasn't changed his idea since Day One and, as a result, hasn't learned much.

The founder leaves the workshop in denial. He doesn't believe in the Lean Startup process because he didn't get past "the wall." In his mind it's not his fault; it's the system. In fact, Pando recently published a piece by someone who fits this description.

We call Lean Startup Machine the "crusher of ideas" for a reason. Many have a life changing experience at LSM when an idea they truly cared about is crushed by "the wall" and they're able to get past it, to pivot and find something with significant potential. These are my favorite entrepreneurs. They learn more than all the others.

Perhaps the worst takeaway anyone can have from LSM is if he didn't validate his idea, it's not invalid. This is the wrong mindset. If you don't want to lose a ton of money and time, your ideas should be guilty until proven innocent.

Yet some people leave LSM, without finding any customers, believing they must build their idea to truly validate it. This is a dangerous trap.

If You Can't Find Early Adopters You Can't Build a Business

There's a pervasive, logical fallacy out there in startup land. Propagated by a Steve Jobs quote and entrepreneurs in denial, it is the fallacy that customers don't know what they want until you show it to them. Of course, the mass market doesn't know what it wants until you show them, but early adopters do. Logically, they must know.

Think about it: If no one knew they wanted something until other people used it, how would this process have started in the first place? A group of people don’t magically start using a product for no reason. And network effects aren’t a solution by themselves. Network effects can magnify value, not turn crap into gold.

Furthermore, why would your target customer use your website if he can’t understand it after a five-minute conversation? Reality is almost always more disappointing than our imagination, and personal selling is more effective than a website. In-person communication is so powerful, you could even falsely convince people they have a problem.

People love to use Twitter as a counter-example. It's not. Just because you didn't understand Twitter before you started using doesn't mean that's how everyone experienced it. Unless you're one of the first few thousand to create an account, you're probably not an early adopter. Twitter rose to prominence after SXSW in 2007, when it solved a very real problem: finding out what people were doing and seeing during the conference. Afterwards, it served as a light-weight way for the technorati to keep in touch and share news.

Another example is Dropbox. Its key strength is ease of use of the product versus what else is out there. How did Dropbox validate people wanted it? Did it build a product? No. Dropbox got 70,000 email addresses off of a screencast and Reddit post. It was easy to explain and validate.

If you can't spend $0 and find early adopters, how is it a good idea to spend $50,000 (the cost of a decent product) in the hopes these people will change their mind once they see it?

Good Product Design Won't Save You

Eric Ries, whose name is synonymous with lean startup methodology, once said, "If you add a great user experience to a product no one wants -- they will just realize faster that they don't want it." My co-founder Grace Ng lived this. Her last startup, PeerBy, couldn't find passionate early adopters, but she persevered, spending months building a website with a gorgeous user experience. Guess what happened when they launched? It fell flat. Another company run by Stanford grads came along a few months later, backed by $1 million in venture capital. Two years later, it's no longer in business.

Paul Howe proves this point even further in his case study. During customer interviews, people were disinterested. He wanted to keep going, but instead of spending millions on a new site, he spent $40 on a “Grease Monkey” script. The passive disinterest turned into passionate hatred when they tried the fake product. After he learned that no one would use it, guess what? Two companies both raised millions of dollars for the same idea. Those companies spent all of the money and went out of business.

You might argue you can’t test the impact of a better user experience without building a product. This is not true. Close.io comes to mind as a service that made me switch immediately from Salesforce.com because of its user experience. But it didn't need to build anything to find plenty of early adopters with pain.

People cry that CRMs are complicated and confusing. The fact that a superior UX was the answer was because everyone was asking the question. Any startup that can successfully compete through a better product design can also find users who are unhappy with the current solutions.

Make a Choice: Your Great Idea or a Successful Business

It sucks when you can't find customers excited about your idea. And there will always be some shred of doubt. Maybe you weren't asking the right questions, or you just couldn't find the right people. If you build it and put it out there, perhaps someone will discover it and start using it. Wrong. This is simply not the case 99 percent of the time.

At the end of the day, the only sure way to build a successful business is to find people with a problem and solve it. You will have many ideas throughout your life but few chances to build a great company.